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  "documentTitle": "TPC Group Inc. (TPCG)",
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  "authorName": "Sandell Asset Management",
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  "presentationDate": "2012-10-01 00:00:00",
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  "notes": "Uses specific financial data points to highlight 'mystery' cash costs and management's changing narrative.",
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      "text": "It is unclear what this $96m and $62m cash flow discrepancy in 2013 and 2014 could be; however, in our LBO analysis we have conservatively included these ‘mystery’ cash costs.",
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      "kind": "list",
      "text": "capital cost required to restart its two offline de-hydro assets sum to a total greater than the market cap of TPC Group and more than 20% higher than our prior estimation; and issues with sourcing mixed C4s due to increased competitive pressure",
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      "text": "EBITDA: $96m",
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      "text": "Lastly, there seems to be a discrepancy in TPCG's unlevered free cash flow (UFCF) estimates. As shown below, UFCF for the Core TPCG business is significantly below what would be estimated using D&A and Maintenance Capex figures provided by management. It is unclear what this $96m and $62m cash flow discrepancy in 2013 and 2014 could be; however, in our LBO analysis we have conservatively included these 'mystery' cash costs.",
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      "kind": "paragraph",
      "text": "Furthermore, Fairness Opinion EBITDA estimates are well below long run estimates given by current management in October 2011 and communicated to various shareholders in July 2012. These differences most likely reflect the changing motivation of management once an LBO is being contemplated.",
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      "kind": "paragraph",
      "text": "EBITDA estimates presented in the Fairness Opinion are near the estimates of the most bearish sell-side analyst; however, they are noticeably lower than other sell-side estimates.",
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      "kind": "paragraph",
      "text": "As an example, management is now talking down real values - as evidenced by a sell-side research piece published by Macquarie on September 10th, 2012, stating previously undisclosed information to encourage shareholders to vote for the current deal. Some negative management comments from this note:",
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      "kind": "quote",
      "text": "capital cost required to restart its two offline de-hydro assets sum to a total greater than the market cap of TPC Group and more than 20% higher than our prior estimation — Macquarie",
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      "kind": "source-note",
      "text": "(1) estimated from unlevered free cash flow estimates given in projections (2) in Oct 2011, TPCG management estimated that long term EBITDA could be 2x-3x current levels of $158m, also reiterated this in July 2012 to shareholders (3) using EBITDA estimates, $45m in D&A, 35% tax rate, $15m maint capex",
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      "text": "Differences in EBITDA Estimates and Differences in Unlevered Free Cash Flow (UFCF) Estimates tables",
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      "kind": "title",
      "text": "Projections For Core Business and Project Phoenix Are Low-Balled",
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